October 3, 2011

Minimum wage increases to £6.08 per hour

by Kay Mitchell

The UK minimum wage rose by 15p to £6.08 an hour from Saturday 1st October and is set to benefit almost one million people, according to the Low Pay Commission.

The 15p an hour rise applies to workers aged 21 and over.

Meanwhile, the rate for 18 to 20-year-olds will increase by 6p to £4.98, while 16 and 17-year-olds will see a rise of 4p from £3.68 an hour.

Furthermore, the hourly minimum wage for apprentices has risen by 10p to £2.60.

The increase is in accordance with a recommendation from the Low Pay Commission.

However, it is far behind the retail price index (RPI) measure of inflation, which is used as the basis for many wage deals.

The minimum wage was introduced in 1999 by the Labour Government to put a floor under what employers could pay their staff.

The increase has been welcomed by the TUC but Unison said the rates are still too low and said £8 an hour is required to provide a living wage, particularly in light of rising food costs and utility bill hikes.

However, the Low Pay Commission has suggested that the minimum rate for young people may deter firms from recruiting them.

Official figures last month revealed that nearly 1 million of the 2.5 million unemployed people in the UK are aged between 16 and 24.

More than 200,000 of these have been out of work for over a year.

The Low Pay Commission told ministers: “Recent research has found evidence that in difficult economic circumstances the level of the minimum wage may have had an impact on the employment of young people.”

The British Chambers of Commerce believes that there should be a freeze in the minimum wage for younger workers since some companies are finding the rate “is a real problem.”

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